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Country-by-Country Reporting — OECD Updates Guidance

Country-by-Country Reporting — OECD Updates Guidance

Updated OECD guidance offers new clarifications and administrative guidelines


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Additional OECD guidance on country-by-country reporting (CbC) is now available. The new guidance clarifies some aspects of preparing country-by-country reports, including details on reporting dividends received, shortening and rounding amounts and including necessary source information in the CbC report. In addition, the new guidance discusses administrative matters, including common errors that multinational groups have made when completing their reports.


Country-by-Country (CbC) reports contain valuable information on the global allocation of income, taxes paid and the location of economic activity among tax jurisdictions in which a multinational group operates. This information may be used by tax authorities in high-level transfer pricing risk assessment, assessment of other BEPS-related risks, and economic and statistical analysis.

Updates to guidance

Treatment of dividends in Table 1

The OECD clarifies that payments received from other constituent entities that are treated as dividends in the payer's tax jurisdiction are excluded from "Profit (Loss) before Income Tax" in Table 1, "Overview of allocation of income, taxes and business activities by tax jurisdiction", consistent with the exclusion of these amounts in "Revenue". This guidance applies to all reporting fiscal years of multinational groups that commence on or after January 1, 2020, with earlier adoption encouraged. The OECD notes that this guidance replaces previous guidance that it issued in September 2018.

Shortened or rounded amounts in Table 1

The OECD confirms that its reporting guidance specifies that multinationals should use the full financial amounts when completing Table 1, as shortened amounts are not acceptable. However, the OECD notes that some jurisdictions may accept a reasonable level of rounding, even though is not required to accept any rounding. The OECD says it will monitor the use of rounded amounts and may revisit this guidance in the future.

Source of information in Table 3

The OECD advises that although a multinational group may provide a brief description of the sources of data used in Table 3, "Additional information", the description must be sufficient to enable an understanding of the source of each item of information. Further, the description must provide an explanation when information relevant to a particular jurisdiction is taken from multiple sources of data, or where those sources change over time.

Additional administrative guidance

In the revised guidance, the OECD identifies common issues that multinational groups have made when preparing their country-by-country reports. In the guidance and an additional chart, the OECD outlines 14 reporting errors that tax administrations have encountered, alongside how the information should have been reported as referenced in other OECD publications.

The OECD also comments that:

  • A multinational group's reporting fiscal year may be less than 12 months for the purposes of a country-by-country report
  • When applying the "deemed listing provision", if the parent entity of a multinational group is tax resident in a jurisdiction that does not have a securities exchange, the jurisdiction should specify one or more jurisdictions with a securities exchange that would be considered acceptable when determining whether an entity is the ultimate parent entity of a multinational group
  • Jurisdictions cannot require constituent entities to file a country-by-country report under local filing rules if the ultimate parent entity of a multinational resides in a tax jurisdiction that does not require a country-by-country report to be filed, and this is in accordance with the BEPS Action 13 minimum standard (including taking into account interpretative guidance)
  • Jurisdictions are encouraged to be flexible when applying local filing (i.e., to accept local filing that contains information from the ultimate parent entity's filed country-by-country report)
  • Jurisdictions with local filing requirements should consider applying a filing deadline for these reports no earlier than 12 months after the end of the reporting fiscal year
  • All jurisdictions should consider making a unilateral declaration to bring forward the effective date of the multilateral convention on mutual administrative assistance in tax matters when exchanging country-by-country reports, where appropriate.

For more information, contact your KPMG advisor.

Information is current to November 12, 2019. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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